Dear Entrepreneurs, In recent years, the Indian startup ecosystem has really taken off and come into its own—driven by factors such as massive funding, consolidation activities, evolving technology and burgeoning domestic market. Compared to a few years ago, Indian startups now have easier access to capital, mentors, and there is lesser taboo associated with starting a new venture. Many startups and small and medium-sized firms dream of becoming big players one day. However, realizing that goal is a long and arduous task that requires several key elements to be in place. One of the significant element is to associate with a perfect banking and financial partner. At SBI we were witnessing a continuous need for creating a one-window system for startups, designed for their

financial requirements. To fulfil the need we have inaugurated SBI InCube, a dedicated branch for Startups at Bangalore. We invite you to be part of the banking system by opening an account with InCube so that we can assist you in your journey to Unicorn.

With Best Wishes Rajni Mishra, CGM Bangalore

Shri Mohandas Pai lighting up the lamp for inaugurating

InCube along with SBI Chairman Ms. Arundhati

Bhattacharya and Shri Rajnish Kumar, MD SBI. Also

present Mrs. K Ratnaprabha, Addl Chief Secretary and

Shri Sharad Sharma, iSPIRT

Chairman SBI, Inaugurating monthly newsletter

“StartUps with SBI”

InCube: Banking for Disrupters

Chairman SBI, addressing audience at the gathering.

Panel discussion on “StartUp India: Emerging trends, Meeting Financial Challenges” Also Seen Ms. Ananya Tripathi,

Head of Strategy & Planning, Myntra, Mr. Rajiv Srivatsa, COO Urban Ladder, Mr. GV Ravishankar, MD Sequoia

Capital, Mr. Joydeep Sengupta, Director McKinsey & Co., Padma Shri Mohandas Pai, Mr. Vikram Vaidyanathan,

MD Matrix Partners, Mr. Mayank Jain, Head of corporate strategy, Flipkart, Mr. Atul Tewari, COO Quickr

On 16th January,16 Prime Minister Mr. Narendra Modi presented the outline of the government's "Start-up India" plan to an

enthusiastic audience. The intention of the plan is to be applauded, and there is much in it that is praiseworthy. However, euphoria

over it needs to be tempered with a realistic assessment.

Action Points Details Positives Minus

Compliance regime based on self-certification

Self-certification through mobile app Nine labour laws, including gratuity without any

inspection, for three years Three environmental laws

No inspection Comply with laws according to mandate Random checks possible

Including gratuity, as in normal circumstances, it applies for companies over five years

Start-up India hub Ecosystem in hub-spoke model Collaborate with state and center, VCs,

universities, R&D centres Organise mentorship programmes

Already informal model exists across India

No formal mechanism

Rolling out mobile app and portal

The app shall be made available on all leading mobile/smart devices platforms from April 1

Registering start-ups with agencies Mobile app integration with Ministry of Company

Affairs

Promise of simple Procedure

Need to upgrade MCA website to handle integration

Legal support and fast-tracking patent examination at lower costs

Filing for compliances Launched on a pilot basis for one year Fast tracking start-up IPR shall help file patents Panel to assist patent filing 80% rebate on patent filing

Will help start-ups build IP-focused innovations

No long-term plans No clarity whether thiswould also apply for foreign patents

Relaxed norms of public procurement for start-ups

Relaxes tender qualifications on prior experience/turnover

Includes start-ups in MSME category that get 20 per cent preference in government sourcing

Would help start-ups to bid for govt contracts Help innovative ideas to scale Need to prove capability to execute

No clarity whether new ideas and processes would be encouraged

Faster exit for start-ups

Insolvency for simple structure start-ups in 90 days The Insolvency and Bankruptcy Bill, 2015,

presented in Parliament already has the provisions

If Bill is passed, good Start

Providing funding support through a fund of funds

Fund of funds Corpus of ~10,000 crore ~2,500 crore investment each year for four years Fund managed by a board LIC as a co-investor

Not just focused on tech, manufacturing, agriculture included

Clarity on how performance of the fund measured

Credit guarantee fund for start-ups

Help flow venture debt from banks Credit guarantee mechanism through National

Credit Guarantee Trust Co Corpus of ~500 crore every year for four years

Provide credit guarantee for start-ups

Banks should give loans based on business opportunity, not be forced to lend

Tax exemption on capital gains

Promote investments into start-ups by mobilising the capital gains arising from sale of capital assets

Aimed at suitable incentives for investors to invest in start-ups

Overall, while the intent is praiseworthy and there are many laudable ideas in the policy, much in the fine print needs attention if

its goal is to be realised. Hopefully, the government will be nimble in making any needed changes and in overseeing Start-up India's

implementation.

StartUp India : Action Plan

On 2nd Feb, RBI Governor highlighted the steps being taken by the Reserve Bank of India, to promote the ease of doing business and contribute to an eco-system conducive for growth of entrepreneurship, particularly in respect of the start-up enterprises. The details are:

1. Enabling start-up enterprises to receive foreign venture capital investment and also explicitly enabling transfer of shares from Foreign Venture Capital Investors to other residents or non-residents;

2. Permitting, in case of transfer of ownership of a start-up enterprises, receipt of the consideration amount on a deferred basis as also enabling escrow arrangement or indemnity arrangement up to a period of 18 months;

3. Enabling online submission of A2 forms for outward remittances on the basis of the form alone or with document(s) upload/submission, depending on the nature of remittance; and

4. Simplifying the process for dealing with delayed reporting of Foreign Direct Investment (FDI) related transaction by building a penalty structure into the regulations itself.

Mr. Adithya Padala,(CEO of UmeVoice a leading Silicon valley

Company pioneered in world’s best noise cancelling headsets

called the Boom and one of the charter members of The Indus

Entrepreneurs (TiE) and one of the mentors for Silicon Valley

Launchpad for TiE) visited SBI InCube on 25.01.2016. He

appreciated the ambience and congratulated SBI for this

initiative.

He enquired about the facilities SBI InCube is offering to

Startups. Following are some of his observations:

Initiatives of both Government of India and State Bank of

India are unique and are in the right direction to give the

Start-Up community the required boost.

Start-Ups should concentrate on building a customer base and gaining traction by improvising their product which will

automatically invite the VC attention and the projects will take off, instead of looking for VC funding in the initial stages.

Mr Padala also threw some light on his interactions with the Prime Minister during his visit to the Silicon Valley and on

Start-up India event. He is hopeful that the new policy for start-ups will benefit the start-up eco system in the country and

help India become the next destination for start-ups.

Thank you very much Mr. Padala, for your interactions and we move forward with your inspiration!!

(Mr. Padala is in India, leading the delegation of Silicon Valley Entrepreneurs to the Start-Up India – Stand Up India campaign kick started on 16.01.2016 by Government of India)

Date Event Venue

12.02.2016 Product offering in SBI InCube for startups Ginserve (Global Incubation Services) Auditorium, HAL 3rd Stage, Kodihalli, Bengaluru

27.02.2016 Startup Master class V3, organised by IIT Kanpur Alumni Association

JW Marriot hotel, 8th Road, Plot No 75, EPIP Area, Whitefield Bengaluru

To Know More visit our website www.sbi.co.in or call our toll free number 1800-112211 Start-up branch: SME Branch, State Bank of India, Local Head Office Campus, 65, St. Marks Road, Bangalore. Sudhindra- 9535195706, Vandana- 9480841995, Deviga- 9845366362 080-25943334, 25943329, sbi.11349@sbi.co.in

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Editorial Team: Sunil Yadav (CM& Head), B.S.Rathore (Manager) SBI RTMU Bangalore Disclaimer: In the preparation of the material contained in this newsletter, SBI has used information that is publically available, including information developed in-house. Information gathered & material used in this document is believed to be from reliable sources. SBI however doesn't warrant the accuracy, reasonableness and/or completeness of any information. All recipients of this material should seek appropriate professional advice before dealing and or transacting in any of the products referred to in this material and make their own investigation. SBI shall not be liable for any loss, damage of any nature, including but not limited to direct, indirect, punitive, special, exemplary, consequential, as also any loss of profit in any way arising from the use of this material in any manner whatsoever.

RBI Announces Regulatory Relaxations for Startups

Important Events scheduled during the month

The Day We Cherish…………